JUDGMENT
J.N. Bhatt, J.
1. This appeal is directed against the judgment and award passed by the learned Commissioner for workmen Compensation, at Jamnagar, on 15.9.1982, in a workman compensation Application No. 18 of 1979. Thus, the appellant has invoked the aids of the provisions of Section 30 of the Workmen’s Compensation Act, 1923 (‘Act’ for short, hereinafter).
2. The facts leading to the rise of the present appeal may be, shortly, stated at this juncture so as to appreciate the merits of the appeal and challenge against it.
3. The present appellant is the original opponent No. 1 Company, present respondent No. 1 is the original claimant and present respondent No. 2 is the original opponent No. 2-Con tractor. The claimant, Koli Gobardhan, filed the aforesaid application for compensation under Section 3 of the Act. The claimant, inter alia, contended in his compensation that he was a workman of the original opponents. That during the course of the employment with the opponents, on 23-3-1977, the claimant, while he was spreading sand on rail, fell down on rail and his hand came under the wheel of the loco engine passing at that time. Thus, he contended that he sustained serious injuries on his hand. According to him, he sustained 69 per cent permanent partial disablement on account of the said injuries. He was earning monthly wages of Rs. 151-50 ps. He was a workman and he sustained personal injuries by an accident arising out of and in the course of his employment with the opponents. Therefore, he claimed an amount of Rs. 13, 876.80 ps. as compensation. Notice was served by the claimant on the opponents. It was not complied with. The claimant also claimed for penalty at the rate of 50 per cent and interest at the rate of 6 per cent per annum from the date of injury. Thus, the claimant claimed compensation, in all, for a sum of Rs. 13, 876.80 ps. with penalty and interest from both the original opponents.
4. Opponents appeared and resisted the claim petition. Original opponent No. 1-Company filed its written statement at Ex.22 while original opponent No. 2-Contractor filed its separate written statement at Ex.24. The opponents, inter alia, contended that the claimant did not sustain personal injury on account of accident out of and during the course of employment on 23.3.1977. In that, it was contended that it was not the duty of the claimant to spread sand on rail. It was further alleged that the claimant had attempted to get a ride in running loco despite the definite instruction to the labourers not to get in a running loco. The claimant, in an attempt to get a ride in a running loco, sustained injuries. Therefore, the claimant is not entitled to compensation as the act of taking a ride on a running loco was contrary to the specific and definite instructions. Original opponent No. 1-Company also raised a specific contention that the injured claimant was not employed in its employment. According to the contention of the company, the claimant was an employee of opponent No. 2-Contractor. In short, the entire claim petition came to be resisted by both the opponents.
5. In view of the pleadings of the parties, issues were framed at Ex.25.
6. The claimant relied on his evidence at Ex. 32 and also on the evidence of Dr. MM. Oza of Ervin Hospital, Jamnagar at Ex.38. He also relied on the evidence of one co.
worker Limba Khima at Ex.39. Opponent No. 1 relied on the evidence of one K.N. Gandhi atEx.46 and one witness Manvant Jashvant at Ex.48. They also relied on the evidence of loco driver, Manjo Khoma, at Ex.54 and also on the evidence of one witness, a foreman, Siddi Hamir, at Ex.55. Opponent No. 2 relied on the evidence of Ravji Samat, Ex.57.
7. Relying on the aforesaid oral and other documentary evidence on record, the learned Commissioner for Workmen’s Compensation came to the conclusion that the claimant had sustained personal injuries arising out of and in the course of employment with the opponents. The learned Commissioner was pleased to award Rs. 13, 876.80ps. with penalty at 50% on the aforesaid amount and interest at the rate of 6 per cent per annum thereon from the date of injury, i.e., 23.3.1977, againstboththeopponents, withcosts.
8. Being aggrieved by the said judgment and order, the original opponent No. 1 company has, now, come up before this Court in appeal challenging the legality and validity of the impugned judgment and order.
9. Learned Counsel Mr. M.B. Farooqui for the appellant has contended that the injured claimant was not an employee of the appellant/original opponent No. 1 company. This contention was opposed by the learned advocate Mr. Popat for respondent No. 1 original claimant.
10. In order to appreciate the merits of this contention and challenge against it, it would be necessary to refer the relevant facts on record. It is an admitted fact that the accident occurred on 23.3.1977. It is also an admitted fact that the claimant sustained injury. The claimant was working as a laborer at the relevant time. The learned Commissioner has found that the claimant was spreading sand on rail and at that time he fell down on the rail and his hand came under the wheel of the loco passing thereon and he had sustained serious injury on his hand. The appellant/original bpponent No. 1 is the company which had engaged original opponent No. 2 as a contractor. There is no dispute about the fact that opponent No. 1 Company had engaged opponent No. 2 as its contractor for its business and for the execution of the said contract, opponent No. 2, the contractor, had engaged various labourers and claimant was one of them. The contention that the claimant was not employed by the company directly for the execution of its work and, therefore, the company is not liable for payment of compensation under Section 3 of the Act, cannot be accepted in the light of the facts of the present case and in view of the clear proposition of law. The position emerging from that facts of the present case is that the claimant was employed as a workman by original opponent No. 2-contractor, for the execution of the contract work of original opponent No. 1 company. An agreement between the contractor and the company was executed and it is produced at Ex.42. Thus, as per the agreement between the contractor and the company, the contractor had to engage labourers for the execution of the contract work of the company. It is true that the company had not directly engaged labourers for the execution of the said work. As such, the contractor was required to engage workers for the execution of the said contract work stipulated in the agreement, between the contractor and the company. Therefore, the injured workman, who has sustained injuries arising out of and in the course of the employment would be entitled to compensation from both the opponents. The learned Commissioner has considered this contention raised before him seriously and has rightly upheld in favour of the claimant. It would be pertinent to make a reference to the provisions of Section 12 of the Act. According to the provisions of Section 12 of the Act, where any person in the course of or for the purposes of his trade or business contracts with any other person or a contractor for the execution by or under the contractor of the whole or any part of any work which is ordinarily part of the trade or business of the principal, the said person shall be liable to pay to the workmen employed for the execution of the work any compensation which he would have been liable to pay if that workmen had been immediately employed by him and where compensation is claimed by the victim workman or injured workman he would be entitled to compensation from both the persons. No doubt, it is true, that there must be relationship of an employer and employee as pointed out by Mr. Farooqui so as to hold the master liable for thepayment of compensation. If any workman suffers any injury as a result of an accident, arising out of or in the course of employment, obviously the employer is liable to pay compensation to the workman under the provisions of Section 3 of the Act. There must be an employer and employee relationship between the person against whom the compensation is claimed and the workman. But in many cases, persons who want to get the work done try to avoid their liability by contracting with someone else to provide labour or to execute the work and then to contend as it is contended before this court in this appeal that as there is no employer and employee relationship between the workman who suffered injury and, therefore, they are not liable to pay any amount of compensation. To prevent such escape from liability from the payment of compensation, the parliament in its wisdom has dashingly provided special provisions under Section 12 of the Act The material portion of Section 12 of the Act reads as under:
12. Contracting.–(1) Where any person (hereinafter in this section referred to as the principal)in the course of or for the purposes of his trade or business contracts with any other person (hereinafter in this section referred to as the contractor) for the execution by or under the contractor of the whole or any part of any work which is ordinarily part of the trade or business of the principal, the principal shall be liable to pay to any workman employed in the execution of the work any compensation which he would have been liable to pay if that workman had been immediately employed by him and where compensation is claimed from the principal, this Act shall apply as if references to the principal were substituted for reference to the employer except, that the amount of compensation shall be calculated with reference to the wages of the workman and the employer by whom he is immediately employed.
(2) Where the principal is liable to pay compensation under this section, he shall be entitled to be indemnified by the contractor, (or any other person from whom the workman could have recovered compensation and where a contractor who is himself a principal is liable to pay compensation or to indemnify a principal under this section he shall be entitled to be indemnified by any person standing to him in the relation of a contractor from whom the workman could have recovered compensation) and all questions as to the right to and the amount of any such indemnity shall, in default of agreement, be settled by the commissioner.
3. Nothing in this section shall be construed as preventing a workman from recovering compensation from the contractor instead of the principal.
4. This section shall not apply in any case where the accident occurred else-where that on, in or about the premises on which the principal has undertaken or usually undertakes, as the case may be, to execute the work or which are otherwise under his control or management.
11. It is very obvious from the said provisions of Section 12 that when any person in the course of or for the purpose of his trade or business contracts with any other person called a “contractor” for the execution of any work, he shall be-liable to pay to any workman employed for the execution of that work, any compensation which he would have been liable to pay if that workman had been immediately employed by him. The facts of the present case would also attract the ratio of the judgment of this Court rendered in the case of Bai Mani v. Executive Engineer, reported in 1986 (1) G.L.R. 325-1(1987) ACC 76. In the said case, the question that arose for the consideration of this Court was as to whether a contractor employed by the Government had engaged an employee-workman, who sustained injuries and succumbed to the same, during the execution of the work of the contractor or the Government. The deceased workman, in that case, was engaged by the contractor of the Government: Government had not directly engaged the deceased workman. Therefore, the contention of the State Government in the said case was that the State Government cannot be held liable for the payment of compensation under Section 3 of the Act as it was not the employer. This contention was not upheld. It was held in the said case that the activity carried on by the Public works Department is the business activity although it cannot be regarded as a trade. The word “trade” means commercial activity but the word “business” has a much wider connotation and covers activities which may not be commercial and may include the construction work carried out by the Public Works Department. The legislature has advisedly used the terms “trade” and “business” to cover not only commercial activity but also many other activities which would be covered under the term “business”. Therefore, it was held in that case that the State Government was also liable for the payment of compensation for the death of workman. In the present case, admittedly, the company had engaged the contractor for doing the work relating to the ‘trade’ ‘business’ of the company. Admittedly, the contractor had engaged the injured workman. Therefore, the liability for the payment of compensation under Section 3 of the Act would be not only of original opponent No. 1 contractor but also of original opponent No. 2 company. Therefore, he first contention raised by learned Counsel Mr. Farooqui must fail as it is without any merit.
12. Next it is contended by Mr. Farooqui, learned Counsel for the appellant/original opponent No. 1 that the employer cannot be held liable as the injured claimant was not doing any work arising out of his employment. He also contended that the action on the part of the workman in taking a ride on a trolly or loco was contrary to the instructions and, therefore, the employer cannot be fastened with the liability for the payment of compensation. Firstly, it may be mentioned that the evidence shows that the injured claimant was spreading sand on the rail and his hand was pressed under the trolly or loco passing at that time. The evidence of the claimant on this score is at Ex.32. His evidence is also fortified by the evidence of one witness Limba Khima, at Ex. 39. The claimant had immediately narrated the incident and accident to him. Witness Limba Khima has clearly stated in his evidence that the claimant told him immediately after the accident that while he was spreading sand on the rail he fell down and his hand was crushed under the on-coming loco. Therefore, there is no reason to disbelieve the evidence of the claimant on this count. Even if the contention of the opponent No. 1 that the claimant sustained injuries while he was taking a ride in a running loco is accepted, then in that case also, it cannot be gainsaid that the opponents will get exonerated from the payment of compensation. It is very clear from the evidence on record that the place where the labourers were working was very far from the office of the company and the huts and houses of the labourers. There were about 700 to 800 labourers working at the relevant time. The labourers at times had to use trolly for commuting. The witness Limba Khima, Ex. 39, has clearly stated in his evidence that the labourers were using trolly for coming and going to the place of work. Therefore, there was a common practice of using the trolly for commuting. The learned Commissioner also considered this aspect seriously and has held that the claimant would not be disentitled to claim compensation under Section 3 of the Act merely because he had tried to take a ride on a running trolly or loco. It is rightly observed by the learned Commissioner that there was a practice for the workmen to travel by loco. He would not be imputed with the knowledge of any prohibition imposed by the opponents. It cannot be said for a moment that there was disobedience on the part of the workman. Moreover, the claimant and other workmen who are illiterate persons and that aspect cannot be ignored. Therefore, even if it is believed that there was a sign-board prohibiting the workmen to take ride in loco, that would not “ipso facto go to suggest that illiterate persons like the claimant in the present case, had knowledge of the said alleged prohibition. Under these circumstance the claimant could not have been said to have committed any disobedience of the said instruction much less wilful disobedience. Even one witness of the opponents had admitted that there was a practice of taking ride in loco/trolly for going to the place of work. In the facts of the present case.it cannot be said that the accident in question had not occurred during the course and out of the course of employment, as contended on behalf of the appellant/original opponent No. 1.
13. In the facts of the present case, it is very clear that the workman was employed by opponent No. 1-contractor for the execution of the contract for original opponent No. 2-company and, therefore, both the opponents are liable for payment of compensation to the claimant.
14. In the net analysis, the present appeal is totally meritless. Hence, the appeal is dismissed with costs.